In order to provide significant benefits to the investors, Finance Minister P Chidambaram asked all financial regulators to introduce a common demat account for financial assets. Chidambaram also expressed the need for the government and the financial sector regulators to ensure robust growth and manage vulnerabilities. Referring to economic growth, Finance Minister added that although the deceleration in growth has been arrested in the second quarter of 2013-14, the factors such as structural bottlenecks and inflationary pressures are still weighing down the growth process. India's economic growth slowed to a decade low of 5 percent in the previous fiscal and 4.6% in the first half of FY14.
Finance Minister further asserted that inter-regulatory issues should be resolved in a time bound manner by the Financial Stability and Development Council (FSDC) Sub-Committee. Meanwhile, to develop the Indian financial sector, FSDC has taken many measures like development of the corporate debt market, launch of infrastructure debt funds (IDFs) and issue of new FPI regulations. The council has also prepared an assessment of key emerging issues relating to financial stability including preparedness for the impact of US tapering, re-pricing of risk, liquidity crunch and deterioration in the asset quality of banks and its impact on capital adequacy ratios.
Moreover, to facilitate issue of non-equity regulatory capital instrument by banks, the Council suggested Indian regulators like IRDA and PFRDA to reconsider their norms to enable investment by insurance companies and pension fund managers in the Basel III compliant capital instruments issued by banks. Further, FSDC also pursued the implementation of the report of the FSLRC with the view that domestic financial sector remains well-regulated, efficient and internationally competitive.